Farms Technical Inefficiencies in the Presence of Government Programs

20 Pages Posted: 30 Jan 2008

See all articles by Teresa Serra

Teresa Serra

affiliation not provided to SSRN

David Zilberman

University of California, Berkeley - Department of Agricultural & Resource Economics

José M. Gil

affiliation not provided to SSRN

Abstract

We focus on determining the impacts of government programs on farms technical inefficiency levels. We use Kumbhakar's stochastic frontier model that accounts for both production risks and risk preferences. Our theoretical framework shows that decoupled government transfers are likely to increase (decrease) DARA (IARA) farmers production inefficiencies if variable inputs are risk decreasing. However, the impacts of decoupled payments cannot be anticipated if variable inputs are risk increasing. We use farm-level data collected in Kansas to illustrate the model.

Suggested Citation

Serra, Teresa and Zilberman, David and Gil, José M., Farms Technical Inefficiencies in the Presence of Government Programs. Australian Journal of Agricultural and Resource Economics, Vol. 52, No. 1, pp. 57-76, March 2008. Available at SSRN: https://ssrn.com/abstract=1088505 or http://dx.doi.org/10.1111/j.1467-8489.2008.00412.x

Teresa Serra (Contact Author)

affiliation not provided to SSRN

David Zilberman

University of California, Berkeley - Department of Agricultural & Resource Economics ( email )

Berkeley, CA 94720
United States

José M. Gil

affiliation not provided to SSRN ( email )

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